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No. The co-debtor stay that you are referring to exists only in Chapter 13 bankruptcies, Not Chapter 7 cases. Under Section 1301 of the Bankruptcy Code, when a Debtor files Chapter 13, there is a co-debtor stay with respect to co-obligated CONSUMER debts. However, unless the Chapter 13 Plan specially provides for payment in full of that co-obligated debt, the creditor can seek an order from the bankruptcy court terminating the co-debtor stay.

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If you found this answer helpful, let me know by clicking the "Mark as Helpful" button at the bottom of this answer. It's easy and appreciated. This answer does not create an attorney/client relationship and is for informational purposes only. More importantly, the information contained in this answer should not be relied on without first consulting with an attorney who practices consumer or business bankruptcy law, as applicable.

No. First, the only way such a stay would apply would be if your nephew filed for bankruptcy, which you aren't talking about. Second, it doesn't apply to extended relatives like aunts.

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You clearly state that your nephew is filing a CHAPTER 13. If he schedules this debt to be sub-classed and paid in full to protect you, the co-debtor, you will be protected under Section 1301. If he files under Chapter 7 there is no co-debtor protection. Check his Chapter 13 Plan (of which you should receive a copy from the Court as a co-debtor) to see how he is treating this obligation. By the way, the co-debtor stay applies to aunts, uncles, spouses, and even non-related parties. The co-debtor is protected in a Chapter 13 to the extent the Debtor is paying the debt.